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Opinion on retirement suggests UK age laws are safe

01 October 2008

On 23 September the European Advocate General (AG) delivered his long awaited opinion in the “Heyday” case concerning the UK’s retirement age. His conclusions in the opinion have been widely seen as good news for employers.

However, this preliminary opinion from the AG is just the first step in a long process. The next stage is for the European Court of Justice (ECJ) to deliver its judgement. It is expected that this will be early next year.  The ECJ does not have to follow the AG’s opinion, it could reach a different conclusion, but it does follow the AG in about 80% of cases. Once the ECJ has reached its decision the issue will then revert to the High Court who will have to interpret our national law in accordance with that decision.

Heyday, an off-shoot of the charity Age Concern, is challenging the legality of the UK’s age discrimination laws, which came into force in October 2006. In particular, Heyday believes that the UK’s national default retirement age of 65 -  the age at which employers can lawfully force an employee to retire, is not a proper implementation of  European law and should therefore be abolished. Following Heyday’s application the High Court referred certain questions to Europe.

Age discrimination law is unique in that it currently allows for both direct and indirect age discrimination to be justified (and therefore not unlawful). The UK’s legislation allows employers this defence where they can show that they were pursuing a legitimate aim (which the employer may specify) and the means adopted by it to pursue that aim were proportionate – this is sometimes referred to as “objective justification”.  Heyday argues that the UK legislation should define specific legitimate aims and that only these aims may be relied upon by employers attempting to argue objective justification.   

The AG decided that:

• A rule which permits employers to dismiss employees for retirement at age 65 or above is not incompatible with European law provided it can be objectively justified by the Government by reference to employment policy and labour market requirements.   
• Member States are entitled to introduce legislation which allows for a general justification defence; they do not need to define specific types of conduct which can be justified.

Age Concern issued a statement which said:

“This is a set back, but it is not a disaster. Not having the Advocate General’s support for our case is disappointing for us and for the millions of older workers in the UK.

 “The Advocate General's opinion confirms that the EU Directive requires age discrimination to be justified.  It’s now up to the UK government to prove to the High Court that their social and employment policies are important enough to justify kicking people out of work at 65. Until then, older workers face more uncertainty about their right to work.”

Until the matter is decided by the UK’s courts employers should continue to carry out retirement dismissals in accordance with the existing law. Any cases brought by employees where retirement age is an issue will be stayed in the employment tribunals pending the final outcome of the Heyday case.

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Katy Meves

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T: 08700 86 6971
I: +44 (0)1489 61 6971
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